Telco giants look to 5G rollout as they announce $15b merger

The merger between telecommunications giants Vodaphone and TPG will allow the delivery of “very good products” when the 5G network is rolled out, Vodaphone’s boss says.

On Thursday, the companies announced their plans to merge into a single $15-billion company.

Under the new deal, Vodaphone shareholders will own 50.1 per cent of the group, with TPG owning the remaining 49.9 per cent.

TPG is the second largest fixed provider in Australia and Vodaphone is the third largest provider in the mobile phone space.

Vodaphone CEO Inaki Berroeta tells Ross Greenwood the decision to merge was largely because of “the complementary nature of both businesses”.

“This will accelerate our impact in the market,” he says.

Mr Berroeta tells Ross the merger will allow the single company to deliver “very good products” to consumers as the 5G network is rolled out.

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Mr Berroeta has also weighed in on the government’s decision to block Chinese telecommunications giants from being involved in the rollout of Australia’s 5G network, saying it’ll have an “impact” but is understandable.

Late last week, the federal government decided the involvement of Chinese companies ZTE Group and Huawei in the rollout presented too much of a national security risk.

“Just by limiting the number of suppliers that we can use, I think that will have an impact in the market.

“I think also because some of these players are technologically well-positioned, it will definitely have some impact in the market.”